Google shakes empty YouTube piggy bank

Square eyes squared Google is still searching under the sofa for a remote control that might, one day, help the company make money out of its unprofitable YouTube video sharing site.

In the meantime, the ad broker is hoping to convince more copyright holders to sign up to its service. At the moment YouTube only has about 1,000 media makers on its books, more than two years after it debuted its free "Content ID" scheme.

Last week Google wheeled out a Content ID show‘n’tell for some tech hacks at its London headquarters in Victoria.

The presentation was arguably well timed given that it came just 24 hours after a Google management trio in Europe were handed suspended sentences for breaching Italian privacy laws over a video showing a child with Down's Syndrome being bullied by school boys.

Unsurprisingly, the company is keen to emphasise its “responsible” approach to taking control of the videos uploaded to its YouTube service. The idea of the system is to quickly place ownership of a video clip (whether that be the moving images or audio, or both) back into the hands of the creator.

Matt Wiseman, Google’s Content ID product manager, claims the system is “the latest state-of-the-art in helping all rights' holders manage their content on YouTube”. However, he admits that take-up of the firm's video fingerprinting technology hasn't exactly been overwhelming.

"We work with 1,000 content owners, but as you can imagine, there are a lot more out there," says Wiseman.

He says 20 hours of video flows into the YouTube system every minute. So pinpointing copyright infringement can only be determined in full cooperation with the owner of that content.

The fingerprint technology underpinning YouTube's Content ID offers three general policies that a rights holder can apply to their video or audio media. They can block the content; track the viewing metrics or turn it into a money-spinner.

According to Wiseman "most people" (33 per cent of the 1,000 partners currently signed up) choose the fat dollar option.

"The video makers got nothing for their efforts, but Brown’s song became a huge hit as a result of the viral," says Wiseman. Brown's record label agreed to leave the song intact within the video, which has had over 40 million hits since landing on YouTube last July.

“They [video makers] own the copyright for the video portion but not the audio portion, making it a very interesting case,” he says. "Most users see the trade-off… All the revenues were shared back with the music label and artist rather than the video creator.”

Lube up tubes for rights holders

Wiseman says YouTube typically scans 100 years of video every day for potential copyright violations, and that process is now carried out before a clip is published on the site.

"It slows the system down a bit," admits Wiseman. "We’ve worked pretty hard to make sure we’re as fast as we can. It may add 10 or 15 seconds to that process but we’re still doing OK with that."

But he declines to comment on how many copyright infringements occur on a weekly basis.

Meanwhile, Google is hunting high and low for more rights holders to sign up to its free Content ID system within YouTube. To date it has a fairly impressive line-up on its books: typical partners include media players such as Channel 4, sports channels like ECB and the Olympics and record labels including the 'Big Four'.

The latter part of that important ad-generating equation didn't come without a nasty fight, however.

Warner Music only came back to YouTube after a nine-month blockade over licensing. The music label agreed in September 2009 to reinstate its full roster to Google's video sharing site in return for more control and a larger cut of advertising.

The accord gave Warner the right to sell its own ads on "enhanced" channels devoted to WMG artists as well as against user-generated videos using WMG songs in their soundtrack. But here's the interesting bit behind that deal and many others like it: ad revenue is shared with YouTube, with WMG keeping the bulk of the cash.

Returning to YouTube's Content ID, the outfit is currently picking its way through one million reference files provided by those 1,000 big name rights holders that Wiseman talks so positively about.

“We’ve rolled it out in a scaled way and we want to get to the point where any user can sign up to use this system. We’re not quite there yet but we’re certainly interested in it,” he says.

Creepily, for YouTube users at least, content owners using the system gain access to viewing metrics that include demographics, the location of the uploader, how the video was found and something YouTube has dubbed as "hotspots", which shows what part of a video clip was the most popular segment.

"We have these great tools in place but content owners need to partner with us," says Wiseman. "We need the original reference to be able to compare against content uploaded on our site."

In other words, cooperation is vital to help keep Google out of legal hot water. That's perhaps the best Mountain View can hope for from an operation it bought in 2006 for $1.65bn, which still shies away from delivering bags - or even just a single bag - of cash to its owners.

"I’m looking at numbers and we’re claiming large amounts of content and licensing it on behalf of rights holders, sharing the revenue and the revenue is flowing," claims Wiseman, who isn't willing to share any figures with us.

"We’re certainly on the path to profitability, we’ve started to generate significant revenues for our partners and are helping advertisers engage with our users, and it’s a very exciting time." ®